Carl Icahn Offers to Buy More MGM Debt in Push For Lionsgate Deal

Tells creditors condition for purchases is that they oppose Spyglass deal

TORONTO - Billionaire investor Carl Icahn is offering to buy debt from Metro-Goldwyn-Mayer creditors on condition they vote against a proposed combination with Spyglass Entertainment.

Icahn, Lionsgate's largest shareholder who is backing the Canadian mini-studio's rival run for MGM, said his group will purchase senior secured loans to the hobbled Hollywood studio at 45 cents on the dollar. He already owns about 13% of the $4 billion in debt.

Icahn's conditions include at least $963 million of the senior notes participating in the offer.

The offer to buy debt comes as Icahn lines up alongside arch-nemesis Lionsgate to defeat a rival bid to control MGM from Spyglass and succeed with their own.

His debut purchase offer will expire on Oct. 29 when MGM creditors are scheduled to vote on the proposed Spyglass combination.

Icahn said the Spyglass plan for MGM is a "prescription for disaster,” and that it was being “ramrodded through with the typical fear tactic that the 'sky will fall' if the plan is not approved."

The activist investor said the sky was more likely to fall on MGM if its creditors approved the Spyglass plan.